The regulatory problems experienced by Binance.us as well as its owner ‘CZ’ (Changpeng Zhou) have reported led to the investors are quitting a funding round of $100M. This resulted in the failure of the funding round and provoked the CEO of the firm Brian Brooks shocking decision to leave it after being a part of it for only three months. He worked as the company’s acting comptroller for the currency as well as the former chief legal officer of a competitor company Coinbase. He pointed towards some technical issues to be the reason for his exodus. This funding round was considered to be the opening move in the company’s way to introduce an IPO (initial public offering).
New York Times states that Brooks had, at first, flattered possible investors along with Ray Lane from GreatPoint (a venture capital organization) as well as an executive from SoftBank (a holding company of Japan). He assured that all the regulatory directions implemented in the United States would be followed by Binace.us. Nonetheless, some issues have been reported concerning the investors’ anxieties about CZ’s 90% possession in the company in addition to the United States authorities’ reported investigation to scrutinize CZ suspecting him for money laundering and tax evasion. It has also been reported by the U.S. authorities that an ambiguous demarcation between the operations of Binance.us and Binance has also generated unease among the respective investors.
Brooks publicly declared his departure through a tweet on 7th August. One of the spokespersons from Binance.us told that the firm would carry on further to their target of finalizing an IPO within the U.S. The company’s stability in its competition against Coinbase (which finalized its IPO on 14th April) would be enhanced due to an IPO. CZ aspired that the investment round would make it possible for Binance.us to acquire a better position to endure the regulators of the United States through the completion of the IPO.
Apart from the recently befallen troubles, CZ is hopeful that the investors will not abandon Binance.us as an IPO is to be finalized shortly. During an interview on 19th August, he disclosed to Bloomberg that, even now, the top-level investors are interested in the company. While, on 3rd July, the securities and exchange commission of Thailand has also released an exclusive criminal complaint accusing Binance of illegally running a business of digital assets across the country.